For Intel, Android Tablets Are Key To Success

If Intel wants to stop its revenue slide, it needs to get its chips used in more Android tablets.

During the first quarter of this year, Intel saw its revenue from processors drop to $7.9 billion, down from $8.5 billion in the same quarter of last year. This decrease isn’t an isolated event, but part of the continued fallout from declining laptop and desktop sales, which used to be the source of much of Intel’s revenue. And shipments of Windows tablets are still anemic, the company said.

Intel’s Android tablets have had some success, however, as consumers increasingly turn to tablets instead of traditional PCs. Five million tablets with Intel processors were sold in Q1, CEO Brian Kraznich said.

But Intel still has a long way to go to reach the aggressive goals its management has set — 40 million tablets built around its products this year — and weak sales of Windows tablets aren’t helping.

Inside Intel’s Android Tablet Strategy

Google wrote the Android operating system for the ARM processor family, Intel’s rival. But Intel created a version that will run on its x86 processors, which has turned out to be a smart move. Between 80% and 90% of the tablets running Intel processors last quarter used Android, with the remainder running Windows, Kraznich said.

He asserted that this is because consumers prefer Android to Windows, not because another chipmaker is beating Intel. Android’s lead among Intel devices could be because of cost; a majority of Android tablets with processors cost between $125 and $250, Kraznich said. Windows tablets typically sell for more, although Microsoft is working to lower those costs.

These figures are for tablets, not 2-in-1 PC/tablet hybrid devices. Intel classifies a 2-in-1 as a computer with an attached keyboard that can be configured into a tablet shape.